BEACON POWER CORPORATION

                         RESTRICTED STOCK UNIT AGREEMENT


     This Restricted Stock Unit Agreement (the  "Agreement"),  dated as of March
11, 2004 (the  "Effective  Date"),  is by and between  Beacon Power  Corporation
("Company") and _____________________ ("Employee"), an employee of Company.

     WHEREAS,   this  Agreement  is  intended  to  provide   Employee   deferred
compensation in the form of restricted stock units (or "RSUs") that convert into
shares of Company's common stock, in lieu of a cash bonus,  through establishing
and evaluating  targets and awards for Employee,  with Employee having the right
to convert his or her RSUs into shares at any time after such grant;

     NOW THEREFORE, it is agreed as follows:

1.   Accrual and Grant of Restricted Stock Unit Award.

     (a)  General.  Subject to the terms and  conditions  of this  Agreement and
          pursuant to Company's Second Amended and Restated 1998 Stock Incentive
          Plan (the "Plan"),  Company hereby  accrues,  and thereafter to grant,
          RSUs to Employee based on Employee's  having achieved certain targets,
          as  described on the  attached  Schedule A with  respect to 2003.

     (b)  Grants of Accrued  RSUs.  As RSUs have accrued for 2003 (as  described
          above in  paragraph  (a)),  then on the four grant  dates set forth in
          Schedule B (each a "Grant  Date"),  the Company shall be considered to
          have  granted  to the  Employee  one-fourth  of the  total  of RSUs so
          accrued.  Thus,  accruals  from 2003  result  in  grants  in 2004.

2.   Conversion to Common Stock.  Each RSU shall  represent the right to receive
     one (1) share of Common Stock,  subject to the terms and conditions of this
     Agreement.  Employee  shall have the right to convert each granted RSU into
     one (1) share of Common Stock at any time on or after the applicable  Grant
     Date, by delivering  written notice of such exercise to Company;  provided,
     that, if the applicable Grant Date occurs during a period in which Employee
     is (a) subject to a lock-up  agreement  restricting  Employee's  ability to
     sell Common Stock in the open market,  (b)  restricted  from selling Common
     Stock in the open market because a trading window is not available,  in the
     opinion of Company,  or (c) trading is otherwise  not  appropriate,  in the
     opinion of Company,  Employee's  right to convert  such  granted  RSUs into
     shares  of  Common  Stock  shall be  delayed  until  the  date  immediately
     following  the  expiration  of the  lock-up  agreement  or the opening of a
     trading window or confirmation  by Company that trading is appropriate,  as
     the case may be.

3.   Termination  of Employment.  Notwithstanding  anything in this Agreement to
     the contrary:

     (a)  RSUs That Are Already Accrued and Granted. If Employee's employment is
          terminated by either  party,  Employee will retain all RSUs which have
          already been granted (pursuant to the Grant Dates in Schedule B) to


4.   Employee before the "Termination Notice Date",  defined to mean the date on
     which Employee  notifies Company that Employee will resign (if earlier than
     the date of  resignation)  or the date on which Company  notifies  Employee
     that   employment   will  be  terminated  (if  earlier  than  the  date  of
     termination). Also, Employee shall not have the right to receive a grant of
     any RSUs with respect to the period after the Termination Notice Date.

     (b)  RSUs That Are  Accrued,  but Not Yet Granted,  Before the  Termination
          Notice.  If  Employee's  employment  is  terminated  by Company,  then
          Employee shall also have the right to continue  receiving  grants with
          respect to the accrual  period ending on the  Termination  Notice Date
          (including,  if  applicable,  for the pro rata  portion of any partial
          quarter before such Termination  Notice Date). Such grants shall occur
          on the  timetable  specified  in  Schedule  B.  If the  employment  is
          terminated  by the  Employee,  then  Employee  will not be entitled to
          receive  grants of RSUs that might  have  accrued  before  Termination
          Notice.

5.   Nontransferability  of Agreement and RSUs.  This Agreement and the RSUs may
     not be sold,  assigned,  transferred,  pledged or otherwise  encumbered  by
     Employee,  either voluntarily or by operation of law, except by will or the
     laws of descent and distribution. Notwithstanding the foregoing, Employee's
     transfer  to a  revocable  trust that is solely for the benefit of Employee
     and Employee's spouse and/or issue during Employee's  lifetime and transfer
     under such trust at Employee's death to the trust's intended  beneficiaries
     shall not be deemed to be prohibited by the  foregoing  provisions.  If any
     person other than Employee,  Employee's then current spouse, and Employee's
     issue shall possess a vested  interest in such trust during the lifetime of
     Employee,  such interest  shall not be recognized  hereunder as giving such
     person any right to the  benefit of any RSUs or the shares of Common  Stock
     issuable upon  conversion  thereof.  In such event the RSUs shall revest in
     Employee  as if such  transfer  in trust had not  occurred.

6.   No Right to  Continued  Employment.  This  Agreement  shall not confer upon
     Employee any right with respect to  continuance  of  employment by Company,
     nor shall it  interfere  in any way with the right of Company to  terminate
     Employee's employment at any time.

7.   No Right as  Stockholder.  Employee
     shall  not be  entitled  to vote any  shares of  Common  Stock  that may be
     acquired through  conversion of RSUs to Common Stock, shall not receive any
     dividends  attributed  to such  shares of Common  Stock,  and shall have no
     other rights of a stockholder with respect to the RSUs unless and until the
     Common Stock  issuable upon  conversion  of the RSUs has been  delivered to
     Employee.

8.   Compliance with Law and  Regulations.  This Agreement and the
     obligation  of Company  to issue and  deliver  shares of Common  Stock upon
     conversion of the RSUs shall be subject to all applicable federal and state
     laws,  rules and  regulations  and to such  approvals by any  government or
     regulatory  agency  as may be  required.  Moreover,  the RSUs  shall not be
     converted  to  Common  Stock  if  such  conversion  would  be  contrary  to
     applicable  law.

9.   Adjustment to Common Stock.  In the event of any stock
     split,   stock   dividend,   recapitalization,    reorganization,   merger,
     consolidation,  combination,  exchange of shares, liquidation,  spin-off or
     other similar change in  capitalization  or event,  or any  distribution to
     holders of Common Stock other than a normal cash  dividend,  the number and
     class of securities each RSU shall be convertible into under this Agreement
     shall be  appropriately  adjusted  by Company to the extent the Board shall
     determine,  in  good  faith,  that  such an  adjustment  is  necessary  and
     appropriate. As used in this Agreement,  "Board" shall mean Company's Board
     of Directors.  All  references in this  Agreement to the "Board" shall mean
     the Board or a committee of the Board to the extent that the Board's powers
     or  authority  under this  Agreement  have been  delegated  to a  committee
     pursuant to the Plan.

10.  Withholding.  Employee shall pay to Company,  or
     make provision  satisfactory  to Company for payment of, any taxes required
     by law to be withheld in connection  with this Agreement no later than each
     Grant Date upon which Company grants RSUs to Employee. Employee may satisfy
     such tax  obligations by delivering to Company (i) cash in the form of wire
     transfer or check or (ii) shares of Common Stock, including shares retained
     from this Agreement, valued at their fair market value as determined by (or
     in a manner  approved by) Company in good faith or (iii) a  combination  of
     (i) and (ii).  Company may, to the extent permitted by law, deduct any such
     tax obligations from any payment of any kind otherwise due to Employee.

11.  Common Stock  Reserved.  Company shall at all times during the term of this
     Agreement  reserve and keep available such number of shares of Common Stock
     as will be sufficient to satisfy the requirements of this Agreement.

12.  Securities  Act  Exemption.  The RSUs  have not been  registered  under the
     Securities Act of 1933, as amended (the "Securities Act").  Employee hereby
     confirms that  Employee has been informed that any RSUs acquired  hereunder
     are restricted securities under the Securities Act and may not be resold or
     transferred   unless  such  RSUs  are  first  registered  under  applicable
     securities  laws or unless an exemption  from  registration  is  available.
     Company shall in no event be obligated to register any securities  pursuant
     to the Securities Act or to take any other  affirmative  action in order to
     cause the issuance or transfer of RSUs acquired  pursuant to this Agreement
     to comply with any law or regulation of any governmental authority.

13.  Delaware Law to Govern.  This Agreement shall be construed and administered
     in  accordance  with  and  governed  by the laws of the  State of  Delaware
     (without giving effect to any conflict or choice of laws provisions thereof
     that would cause the  application of the domestic  substantive  laws of any
     other jurisdiction).

14.  Notices.  Any notice  hereunder to Company shall be addressed to Company at
     its principal  business  office,  234 Ballardvale  Street,  Wilmington,  MA
     01887,  and any notice  hereunder to Employee  shall be sent to the address
     reflected on the payroll records of Company, subject to the right of either
     party to designate at any time hereafter in writing some other address.

15.  Amendment  of  Agreement.  Company  may  amend,  modify or  terminate  this
     Agreement,  provided  that  Employee's  consent  to such  action  shall  be
     required unless Company determines that the action, taking into account any
     related action, would not materially and adversely affect Employee.

16.  Successors and Assigns; No Third Party  Beneficiaries.  Except as otherwise
     expressly provided herein, the provisions hereof shall inure to the benefit
     of, and be binding upon,  the  successors,  assigns,  heirs,  executors and
     administrators   of  the   parties   hereto.   There  are  no  third  party
     beneficiaries of this Agreement.

17.  Provisions of the Plan.  This Agreement is subject to the provisions of the
     Plan, a copy of which  Employee  hereby  acknowledges  receiving  with this
     Agreement.

18.  Entire  Agreement.  This  Agreement  and the Plan  constitute  the full and
     entire  understanding  and agreement of the parties with regard to the RSUs
     and supersede in their entirety all other prior agreements, whether oral or
     written, with respect thereto.

19.  Severability;   Titles  and   Subtitles;   Gender;   Singular  and  Plural;
     Counterparts; Facsimile.

     (a)  In case any provision of this Agreement  shall be invalid,  illegal or
          unenforceable,  the  validity,  legality  and  enforceability  of  the
          remaining  provisions  of  this  Agreement  shall  not in  any  way be
          affected or impaired thereby.

     (b)  The titles of the sections and  subsections  of this Agreement are for
          convenience  of  reference  only  and  are  not  to be  considered  in
          construing this Agreement.

     (c)  The use of any gender in this Agreement shall be deemed to include the
          other genders,  and the use of the singular in this Agreement shall be
          deemed to include the plural (and vice versa), wherever appropriate.

     (d)  This Agreement may be executed in any number of counterparts,  each of
          which shall be an original,  but all of which together  constitute one
          instrument.

     (e)  Counterparts of this Agreement (or applicable  signature pages hereof)
          that are manually signed and delivered by facsimile transmission shall
          be deemed to constitute signed original  counterparts hereof and shall
          bind the parties signing and delivering in such manner.

     IN WITNESS  WHEREOF,  the parties have executed this  Agreement as a sealed
instrument as of the Effective Date.

EMPLOYEE:                                 BEACON POWER CORPORATION

By:                                       By:
   ------------------------                  ------------------------
   Signature                                 Signature
   Name:                                     Name:
   Address:                                  Title: